Updated – KBO agrees record-value Korean media-rights deal – SportBusiness

The Korea Baseball Organisation has agreed a domestic media rights deal with the country’s three main free-to-air broadcasters worth KRW54bn ($45m) per season for the four seasons from 2020 to 2023, according to local media reports. It is Korea’s most valuable ever sports media rights deal on a per-season basis.
The rights are for matches in the KBO League, the country’s most popular domestic sports property. The broadcasters – KBS, MBC and SBS – have got exclusive rights for the league on television, including pay-television. KBS, MBC and SBS, which operate both free-to-air terrestrial channels and basic-tier cable television channels, frequently bid together for sports rights as a consortium known as the ‘Korea Pool’.
The KBO has a separate agreement for digital rights that began in 2019 and runs until 2023, agreed last year with a consortium of telcos and internet firms composed of internet portals Naver and Kakao, and telcos KT, LG Uplus and SK Broadband. The ‘digital consortium’ is paying KRW22bn ($18.5m) per year. It was the first time the league had ever sold such a package of rights. KBO’s total income for the 2020-23 period across the Korea Pool and Digital Consortium deals is KRW76bn ($64m) per year.
In the Korea Pool’s previous deal for the rights, from 2015 to 2019, it paid KRW36bn per year.
The increase in media rights revenue is a big success for the KBO given conditions in the Korean market. Several major sports media rights properties have fallen in value in the past few years after a long period of growth and as wider television industry revenue growth has slowed. The Korea Pool members in particular have been facing a financial squeeze as growth in television advertising spend has slowed. Exacerbating the problems, the KBO has also been suffering from falling ratings.
The English Premier League suffered a sharp drop in the value of its rights for the 2019-22 cycle. The Korean Football Association ran two domestic media rights tenders in the last two months, one in December and one in January, but failed to get bids that met its asking price.
Announcing the deal, a KBO spokesman said: “When we started negotiations, it was widely expected that [the value of the] broadcasting rights would be lower. The situation has not been good lately, with the advertisement market having been very difficult and the ratings of the KBO league falling.” He said the broadcasters had decided that the league had a bright future, and added that another factor that contributed to the positive outcome for the league was that it had invested in new facilities to reduce production costs for its broadcast partners.
Under their new deal, the Korea Pool will show regular, post-season and exhibition matches. Exhibition matches were not broadcast in the previous agreement.
During the deal announcement, the KBO said that from 2024 it would be integrating its digital and television rights into a single package.
Local media reports said there were expectations that the KBO would use the increased revenue from the new deals to improve aspects of its operation including upgrading its dated internet presence. The league is already planning a new website that will link the websites of all its teams – like Major League Baseball’s does in the US – at a new address, KBO.com There are also demands from fans to improve the quality of refereeing and anti-doping controls.
News website Dailian reported that, in a New Year message delivered in late 2019, KBO president Chung Un-chan said: “We promise to strengthen the competitiveness of the league, industrialise baseball, expand the base of baseball, and strengthen the foundation of integrated marketing and KBO.com in Korean professional baseball.”
Updates:
This story was updated on 11 February 2020 to remove the information that the Digital Consortium had a previous KBO rights deal covering 2016-19. The 2019-23 Digital Consortium deal was actually the first of its kind. The information was also added that the KBO had an IPTV rights deal with SpoTV in 2016.
This story was updated on 6 February 2020 to add the correct period for the KBO’s deal with the Digital Consortium. The previous version incorrectly said the Digital Consortium deal was for 2020-23. 
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